Many homeowners have attempted to “go green” only to realize the additional costs involved with the process. The energy efficient appliances tend to cost more than the older, less energy efficient models, providing little incentive for their purchase. They will save you a few dollars over time in a lower utility bill, but is shelling out hundreds of dollars now for such mediocre savings really worth it? The same goes for new products for home insulation and more energy efficient windows. Sure we would all like to upgrade our homes to save the environment while saving money on our energy bills, but in this economy many of us don’t have the additional funds to pay for these upgrades.
Energy Efficient Mortgage Program
An FHA program that has been around for over ten years is getting more attention these days. The FHA Energy Efficient Mortgage Program allows for homeowners to roll the costs of energy improvements into their mortgage. FHA and VA loan holders have the option of reducing their monthly energy bills without draining their savings account to pay for the upgrades. This can be even more beneficial for those buying a property out of foreclosure, as they may already be buying a reduced property as the result of reduced cash flow.
The program allows for a homeowner to borrow up to $8,000, or 5 percent of the home’s value, to pay for qualified improvements. Some of the improvements include replacing a furnace or cooling system, repairing/replacing a chimney, insulating an attic or crawlspace, replacing windows and doors and installing solar panels. These improvements must be installed by a qualified energy consultant that is familiar with the program. Since the improvements must meet specific codes and inspection criteria, the program requires the use of pre-approved contractors. Contact a local realtor or mortgage lender to find an approved provider in your area.